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After 6 Months of Dealmaking, 7 Days Is Going Private

In a deal nearly six months in the making, Chinese economy hotel chain 7 Days Group(UNKNOWN:SVN.DL) announced Wednesday that it has signed a definitive agreement to sell itself (i.e. "go private") to a group of companies led by Keystone Lodging Company Limited.

Keystone will be paying $4.60 per share for 7 Days. American Depositary Shares -- through which 7 Days common stock trades on the NYSE in units of three common shares-per-one-ADS -- will be purchased for $13.80 per ADS. The total value of all ADS common shares outstanding, therefore, works out to approximately US$688 million, fully diluted.

According to a press release on the going-private transaction, however, the ultimate "beneficial ownership" of 7 Days post-purchase will reside in a consortium composed of private equity powerhouse Carlyle Group's (NASDAQ:CG) Carlyle Asia Partners III fund, the Sequoia Capital China Growth 2010 Fund, current shareholder Actis LLP, and "other existing shareholders of the Company (and/or entities affiliated with or related to them) who have elected to roll-over their interest in the Company in connection with the Merger."

The transaction is expected to close sometime in the second half of 2013.

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